Psychologists have written a great deal about the defense mechanisms humans employ to push unpleasant or harmful things out of their perception of reality. Someone who would wish to go back in time and undo anything is someone who made a terrible investment. A significant financial loss can be extremely distressing for a person, especially if it affects significant life events like retirement, a child’s education, or the buying of a home. Many people may act in ways that worsen the situation because they believe there is no way to recover from their financial loss. Though unfortunately the clock cannot be turned back, it is better to manage the process psychologically than to try and make up the losses through risky investments or other. Suppressing the bad emotions brought on by a loss can be challenging and have unintended consequences. Stress or troubles pertaining to a spouse or work can quickly develop from financial difficulties and loss-related anguish. You can wind up venting your resentment towards friends, family, or coworkers. Those who experience a significant loss frequently attempt to place the blame elsewhere rather than accepting accountability for their own poor choices or overly reckless behavior. People who use these unhealthy coping mechanisms end up holding onto lost assets in the hopeless belief that “they will go up again.” It is nearly always preferable to return a dud that you purchased and invest the remaining funds in something more secure.
